Inventory Management– The Most Important Concept To Be Followed In Retail Management | MITSDE

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Inventory Management The Most Important Concept
To Be Followed In Retail Management

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About Us
Inventory refers to the stocks that are stored
for prospective use or selling. In the retail
industry, it refers to the goods that may be
under various stages of development or in storage
before the selling process.
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Significance of Inventory Management

• Company or retailers opt for inventory
  management because one cannot afford to lose even
  a single customer. If a product is not available
  at a store, then the buyer will go to other
  stores and he/she may be averse to come back to
  that store in the near future as it might leave a
  negative impact on his/her mind. Inventory
  management avoids such kind of situations. So, in
  order to keep the customers intact, inventory
  management is imperative for every organisation.
  This concept forms a proper link between the
  manufacturing of a product and its sale in the
  market within the preferred time period.
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Types of Inventories
Raw Materials Raw materials are the basic
things/objects or key components required for the
production of any item. Work-in-progress These
are the semi-manufactured inventories, e. when
the goods are still in the process of
manufacturing and are yet to be
finished. Finished Goods Finished goods refer
to the final goods that are ready for sale or
that can be stored in the go downs as stocks for
future consumption.

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Motive of Inventory Management
Precautionary Motive The business environment
is dynamic and one cannot predict the future as
there are chances that the business may face
spurt in the demand by the customers.
Precautionary motive refers to managing the
inventory in order to avoid any unpredictable
loss in the future.
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• Transaction Motive
• In the future, a company may face situations
  such as unavailability of raw materials or
  finished goods. Transaction motive entails
  avoiding such situations or any other bottlenecks
  by managing inventories.
• Speculative Motive
• Price fluctuations occur frequently and a
  company can take advantage of this situation in
  the near future by holding inventories for the
  stipulated time. This is termed as a speculative
  motive.

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Conclusion

• Inventory Management is the core process that
  marks the success or failure of any retail store.
  It is an integral component of Retail Management.
  
• That is why our course materials of PGDM in
  Retail Management include lucid lessons on
  Inventory Management.
• We provide our students with all the requisite
  knowledge and skills in Inventory Management that
  eventually makes them sought-after candidates for
  the industry.

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